The Origins of Neoliberalism, Part III – Europe and the Centre-Left Fall under Hayek’s Spell

As we have already seen some in the American right-wing loathed the economic planning that had grown up in the US in World War II and which, due to producing good outcomes for the overwhelming majority of citizens, gained consensus in the post-war years. This gave rise to a new propagandistic discourse aimed at what Hayek and others called “socialism” but which had little to do with the collective ownership of the means of production and was in reality a mixture of pragmatism and centre-left sentiment. The reason that Hayek’s extremism found fertile soil in Europe was that the underlying conditions were altogether different from those in America but ironically, that meant the model was bent into an even more palatable-looking form.

Europeans were, quite frankly, not as gullible as their American neighbours. They were less inclined to have the words that make up their language twisted and distorted in order to become meaningless propaganda of the sort that Orwell imagined. Unlike in America there was a strong socialist tradition in Europe and people knew what socialism was – and what it was not. The reason neoliberalism ultimately developed in Europe was altogether different.

In the post-war years many right-wing liberal politicians and intellectuals were tarrying with the same problem that Hayek faced in the 1930s. Any honest look at history – and indeed for many of these people this history was lived – would lead one to conclude that totalitarianism and war had developed in Europe, as Keynes hinted that it might in his 1919 book The Economic Consequences of the Peace, due to punitive reparation policies that were deflationary in nature. The neutral observer would also conclude that these circumstances had been exacerbated in Germany by a government which dogmatically pursued austerity policies and that this ultimately led to Hitler’s election. This presented right-wing liberals with a conundrum: how could they continue to support so-called laissez faire, small government policies if these policies resulted in forces that were so destabilising that they had led in the past to the most monstrous of tyrannies?

1. Most "conservatives" have no idea who Hayek was

In fact Hayek's role is greatly exaggerated by radical rightist propaganda. There will always be "conservative" thought and it will always ebb and flow, more or less resembling fascism. The current iteration more resembles fascism, which is why it is mercifully on the wane. And even amongst radical capitalists such as Ayn Rand cultists, anarcho-capitalists, freshwater economics types, von Mises, or anything else that radical capitalists may refer to themselves as there is a tremendous amount of conflict, discord, and discontent. This conflict is inevitable for any radicalized extremist faction and arises over the most amazingly minute deviation.

You have to always remember that half of the population has IQs below 100. The real attraction of a Hayek or a von Mises is that it reduces human nature to a simple set of rules or bumper sticker slogans. When you view the world through such blinders you dispense with the inconvenience of having to analyze and weigh the facts and circumstances. "Conservatives" aren't good at logic and reason so their paint by the numbers ideology allows them to think they look smart without having to actually think things through.

2. Given. So, we need a way of referring to how what they are thinking of, because of its very strong

tendency toward "conflict (that) is inevitable for any radicalized extremist faction and arises over the most amazingly minute deviation", develops regressive feed-back loops that can (and mostly likely DO) result in the loss of value, not only in more obvious observable ways (and for which there is likely also no systemic remediation for even that concrete loss), but also, and possibly even more vitally important, there is the loss of other values BEFORE they are even recognized as values (and for which there is even less systemic provisions for remediation - outside of "kill-or-be-killed" competition).

It boils down to: if your objective is an economic enterprise, and not just the false security of authoritarian power/fascism, then radical capitalism ISN'T the most efficient conservor of value there is, right? Can't we use our recent economic history to illustrate this fact? But how do we turn it into something as easily accessible as the cult of the individual turned out to be?

3. They are sufficiently discredited.

They are out and still on the decline. What we need is to make good progress and to not ever get complacent. We have learned a few things. We know how to deal with their smears. We know how to deal with their voter suppression. We know how to counteract their big money.